The Supreme Court will consider the dispute on the legality of reimbursement of expenses to the manager, spent on protecting his interests

The Supreme Court of the Russian Federation (SC) will decide whether the arbitration manager (AI) conducting the bankruptcy case is entitled to reimbursement of expenses incurred in connection with the protection of his own interests. The tax authorities decided that the AC did not fully fulfill its duties and filed claims against it. The manager was able to defend himself by hiring a lawyer. But the courts refused to reimburse these expenses at the expense of the tax authorities, considering that the AU is able to protect itself. Lawyers note that “unscrupulous persons” regularly file complaints against managers in order to put pressure on them, and support for the Supreme Court could reduce the number of unfounded claims.

The Supreme Court will consider the dispute on the legality of reimbursement of expenses to the manager spent on protecting his interests. As part of the bankruptcy of Nikolai Babakin (declared bankrupt in August 2018), MIFTS No. 16 for the Altai Territory applied to the Rosreestr department for the Moscow Region with a request to check the performance of Vladimir Fonoberov by the AC, and, if necessary, bring him to administrative responsibility.

The MIFNS believed that the manager did not publish in the EFRSB data on the intention to pay creditors’ claims in full and information on the valuation of assets, did not close the debtor’s accounts and violated the deadlines for applying to the court with the regulation on the procedure for selling property. In connection with the claims of the AC, legal assistance was needed, and he attracted a consultant, agreeing to pay him 100 thousand rubles for the services.

In March 2022, the administrative case against Mr. Fonoberov was terminated “due to the lack of corpus delicti”, in April he fully paid for the legal services provided and asked the court to recover these costs from the Russian Federation represented by the Federal Tax Service, considering them his losses.

In August 2022, the Moscow Arbitration Court recognized the right of the manager to compensation for damages in the amount of 2 thousand rubles, considering the amount “reasonable and commensurate with those recovered for the provision of such services in similar cases.” The court noted that the considered administrative case “is not complicated, did not require either high qualifications or significant time costs.” The appeal agreed with this.

The cassation canceled both decisions and completely dismissed the suit of the AC, explaining that the costs of attracting specialists in the administrative case “are not refundable at the expense of the tax authority.” The district court noted that in the actions of the tax authorities there was “no sign of wrongfulness necessary for prosecution.” The decision states that there was no need for the legal services of a third party, since the manager is “competent enough to independently resolve issues related to bringing him to administrative responsibility for offenses in his professional activities.”

Vladimir Fonoberov complained to the Supreme Court, emphasizing that his professional status “does not deprive him of the right to reimburse the costs of legal assistance incurred from his own funds”, since the need to involve a specialist arises “not only in the event of a lack of professional knowledge in the field of law, but also in other reasons.”

The applicant explained that he worked in the Altai Territory, and the tax authorities wanted to bring him to justice in Moscow, so that “the most optimal and reasonable way to protect their interests was to hire a representative who was at the place of the case”. According to the manager, he “personally and involuntarily incurred expenses that are not covered by remuneration and not reimbursed from the bankruptcy estate.” Moreover, the basis was the “unreasonable statement” of the tax authorities, which “obviously does not correspond to the principle of justice.” For these reasons, the case was referred to the Economic Collegium of the Armed Forces, and consideration was scheduled for August 31.

“The struggle of interested persons against AC by the hands of Rosreestr has been going on for a long time with varying success,” emphasizes Aleksey Tolmachev, an attorney in the bankruptcy practice of INTANA Legal. Complaints about the actions of the manager “have long been reborn from a means of ensuring the rule of law into an instrument of procedural pressure on the part of persons dissatisfied with this or that decision of the AC,” confirms Alexei Maistrenko, senior lawyer at the RCT consulting group. Considering that the manager is always at the center of the conflict between opposing actors, “there will certainly be dissatisfied creditors or others who mistakenly believe that the AC has maliciously infringed on their interests,” adds Mr. Maistrenko.

The dispute is very important for the work of any AU, primarily because “we are talking about reimbursement not of court costs, but of costs at the stage of consideration of a complaint in Rosreestr,” explains Valeria Gerasimenko, head of the council of the Union of AU SRO “Northern Capital”. According to her, “throwing the AC with complaints” has long been used to influence it, while “it doesn’t matter if the complaint is justified or not, the AC will still be forced to respond to Rosreestr’s requests, give explanations and participate in the preparation of the protocol.”

According to Mr. Tolmachev, the current practice in this matter is “contradictory” and the courts “do not always and reluctantly recover the money spent, sometimes without even understanding the legal nature, whether these are losses or legal costs.” The position of the Supreme Court, says Aleksey Sharov, Managing Partner of AVERTA GROUP, may become “an important guarantee of the AC’s right to reimbursement of expenses related to its own defense” in an administrative case and, in the future, reduce the number of unfounded complaints, since “the risk of reimbursement of expenses will be a disciplining factor for potential applicants” .

Ekaterina Volkova